EU VOEC VAT calculation not working
Hi there, is anyone else experiencing this problem, or knows what we’re doing wrong…
We received our first order for delivery from UK to Hungary following new EU VOEC rules.
Price on Amazon.co.uk is inclusive of 20% VAT but VAT in Hungary is 27%
We are UK VAT registered, use AVS and have set up Amazon VAT codes for all our products
When order was received, Amazon calculation had simply deducted 27% VAT from UK VAT inclusive price for IOSS shipment and we lost money.
I understood that Amazon would automatically calculate the UK ex. VAT price and then add the Hungary VAT back on, but this didn’t happen.
Please help… does anyone know what we’re doing wrong with our pricing?
7 replies
Seller_xEj8BltWOkqzg
Yes, this is also happening to us too. We have an order going to Ireland and they’ve taken the 23% VAT off the UK inclusive VAT price. I’ve opened a case to get more clarification on this.
Seller_xEj8BltWOkqzg
I’ve contacted Seller Support but I’ve not received a response. I’ve checked with other marketplaces and EU VAT is being applied on the VAT exclusive price (i.e. removing UK VAT and then applying the EU country’s VAT rate). It’s been over 2 weeks since IOSS went live, so it’s worrying that this hasn’t been fixed yet.
Seller_xEj8BltWOkqzg
Seller_tRuvBEHDedp4q
It seems to me as if Amazon is not even following its own calculation service methodology.
If they were, and based on the examples above, your goods should have had the UK VAT element removed then the Hungary VAT added.
That is how it should work based on the regulations and Amazon own published methodology.
The regulations make it clear that when you sell something from the UK to the EU the transaction is done in 2 steps.
- You sell to Amazon as a B2B VAT exempt basis
- Amazon sells to the customer as a B2C VAT inclusive basis
Therefore, as far as I can see, you may have a case of taking Amazon to the Small Claims Court for the difference in price as they paid you less than what was agreed - they took off 27% Hungary VAT, so the price they paid you was less than agreed, as they should only have removed the UK VAT amount.
